The new agreement makes modest revisions to a trade deal Trump once called a “disaster,” easing uncertainty for companies reliant on tariff-free commerce among the three countries. U.S. stocks climbed on Monday toward records, while the Canadian dollar and the Mexican peso gained. The S&P 500 Index climbed 0.6 percent by 12:29 p.m. in New York.

Trump cited in particular provisions governing automobiles, raising the portion of their content that must originate within the region to 75 percent, from 62.5 percent, and requiring at least 40 percent of a car to come from workers whose pay averages more than $16 per hour. The president called those rules “the most important thing” for him.

Eoin Treacy's view

The cosmetic changes to the NAFTA agreement provide some protections for workers but no so much that the fabric of the agreement is going to be fundamentally changed. That’s a significant development of North American markets since the trade they do with each other is at least as significant as what is done with the rest of the world.

The S&P500 continues to hold its progression of higher reaction lows but the IMF’s downgrading of global growth forecasts took some of the lustre off the NAFTA statement. The overextension relative to the trend mean is currently sitting at just under 6% which historically is not all that much but the pace of the advance has been rather modest of late and some consolidation of the gain since July is looking increasingly likely.

The S&P/TSX Index has paused above the 16,000 level and since May but will need to continue to hold that level if consolidation is to be given the benefit of the doubt.

The strengthening of the Loonie over the last four months may be a contributing factor in the underperformance of the stock market.

The Mexican iShares MSCI Mexico ETF has been ranging mostly between $45 and $55 since early 2016 and is now pausing above $50. It needs to sustain a move up and out of this range to confirm a return to demand dominance.